For many people, retirement is the perfect time to start taking it easy; however, for others it is an opportunity to start a business and become more independent. For some this is a necessity, as the income is needed to top up pension payments and make later years a lot more comfortable. Starting a business after retirement is something that requires time, energy and some degree of investment; most important of all, however, is an effective plan.
Choosing the right business
Starting a business is the chance to work in a field that means something to the business owner. It could be based on a hobby or interest, or it could be the chance to try something that has always been a dream. Those who choose to work in a field that does not interest them will find it much harder to keep the business going. There are a number of factors that should be taken into consideration. These will include the hours that the retiree is prepared to put in, whether they will need assistance with the business, and where the business is to be located. Someone who is looking to make his or her craft hobby into a moneymaking opportunity might enjoy putting in more hours than someone who would need to work away from the home.
If money is a strong motivator, some businesses that are based on a hobby may not be the best way to go. They could just bring in a little extra money here and there rather than a regular additional income. The retiree should work out how much more money they need to make to enjoy a comfortable lifestyle and then consider business ideas accordingly.
Legal and financial obligations
Those who are working as a sole trader will not need to register a company, and they will not need to have a separate bank account for their finances. Setting up a limited company is not an obligation, although there are both advantages and disadvantages to this. Those who prefer the limited company option will have protection against any debts run up by the company; however, there is also a lot more paperwork and regulations to be taken into consideration. Those who do choose a more complicated structure may also need professional assistance when it comes to their accounts to deal with issues such as IR35.
Insurance is necessary for most business owners. Some businesses may require public liability insurance, and there are other insurances, such as professional indemnity insurance, that can also be useful. Those who have opted for separate work premises will also need separate insurance. Anyone running a business from home will need to make sure that his or her home insurance company is aware, as the policy will need to be altered.
Marketing is something of a minefield. New business owners can market their business in a number of ways, including via the internet or just locally. Finding customers or clients is a major consideration, as without them the business will not be able to function. Marketing is not necessarily a costly exercise and will pay dividends in the long run.